Biggest risk surrounding the RBA meeting will be stronger verbal intervention from Governor Glenn Stevens amid the resilience in the Australian dollar.

Although the DailyFX Speculative Sentiment Index (SSI) shows retail crowd remains net-long on AUD/USD, the ratio has narrowed as it currently sits at +1.42.

XAU/USD

Despite the spike into $1,296, the lack of momentum to close above former support around $1,291(38.2% retracement) to $1,292 (38.2% expansion) may highlight a near-term top as the RSI preserves the bearish momentum .

Still need a break and close below $1,270 (50.0% expansion) to favor a resumption of the bearish trend carried over from July.

Next downside objective comes in around $1,260, the 61.8% retracement of the December advance.

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Negative Sentiment in EUR/USD Overstretched?

USD/JPY Triangle, EUR/JPY Inverse H&S Point to Weaker Yen Soon

USDOLLAR

Index

Last

High

Low

Daily Change (%)

Daily Range (% of ATR)

DJ-FXCM Dollar Index

10633.97

10643.8

10626.95

0.04

59.97%

Chart - Created Using FXCM Marketscope 2.0

USDOLLAR(Ticker: USDollar):

Looks as though the Dow Jones-FXCM U.S. Dollar Index will continue to close above trendline resistance despite the bearish break on the RSI amid stick inflation.

Non-Farm Payrolls (NFP) highlights the biggest U.S. event risk as employment is expected to increase another 220K in August while Average Hourly Earnings is expected to climb an annualized 2.1%.

Nevertheless, technical outlook continues to highlight the risk for a larger correction as RSI breaks bullish trend & falls back from overbought territory; former resistance around 10,555 (50.0% retracement) to 10,561 (100% expansion) remains in focus.